EAT Criticises Perfunctory Treatment of Sacked Property Manager

In a recent case (Thomas v BNP Paribas Real Estate Advisory and Property Management UK Limited), a senior property management company employee who was made redundant in an insensitive and perfunctory manner after more than 40 years' service had his compensation hopes boosted by a powerfully worded decision of the Employment Appeal Tribunal (EAT). The case serves as a reminder to employers that they have a duty to consult employees at a formative stage in a redundancy situation and to carry out a fair redundancy selection process.

Peter Thomas began working for BNP Paribas Real Estate Advisory and Property Management UK Limited in 1972. In 2004, he was appointed Director in the Property Management Division.

In 2013, after the appointment of a new Head of Real Estate Property Management, a strategic review was carried out and it was decided that there were too many senior managers in the department in which Mr Thomas worked. Shortly afterwards, a formal consultation meeting was held at which he was told that he had been identified as being at risk of redundancy. He was immediately placed on paid gardening leave for the duration of the consultation period, told not to contact clients or colleagues and denied access to the company computer systems and email.

At a final consultation meeting a few days later, Mr Thomas was shocked and upset to be told that he was being made redundant. He had found it particularly hurtful that a letter sent to him by the company following the initial consultation meeting commenced 'Dear Paul'. The subsequent letter informing him of his dismissal was also inaccurate as it gave an incorrect termination date. He appealed against the decision to dismiss him, arguing that the motive for making his position redundant had nothing to do with the strategic review, but this was rejected. He therefore lodged an unfair dismissal complaint with an Employment Tribunal (ET), arguing that the consultation process leading up to his redundancy had been a sham and its result predetermined.

Whilst the ET accepted BNP Paribas's evidence that there had been no suitable alternative vacancies that Mr Thomas could have filled, it was highly critical of the insensitive way in which the matter had been handled. However, it could find no evidence that Mr Thomas's redundancy was predetermined, and went on to reject his claim on the basis that the consultation process had been reasonable.

In upholding Mr Thomas's appeal, the EAT criticised BNP Paribas's decision to put a long-serving employee on gardening leave and insist on him having no contact with clients or colleagues even before the consultation process had started. The EAT was troubled by the apparent contradiction in the ET's reasoning. It was difficult to see how, having found fault with the consultation process, describing it as 'perfunctory and insensitive', the ET had gone on to conclude that it was reasonable. Whilst a consultation process described in those terms could still be found to be reasonable, the ET had failed to explain why the matters that gave rise to its stern criticism and the further insensitivity of the gardening leave etc. were not such as to render the consultation unreasonable.

The ET's decision was therefore overturned and Mr Thomas's unfair dismissal claim sent back to a different ET for rehearing.

This case illustrates that the manner in which the redundancy process is conducted is important. To avoid problems, take advice before you take any action if you face having to make staff redundant.

Although correct at the time of publication, the contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.